How taxes in Brazil hamper innovation


I am doing a research and development project for a client outside Brazil. They sent us (via a well known courier service) a development board for prototyping, with a declared value of USD 326.00 or BRL 520.30. Here’s the breakdown of the taxes charged by the tax office of our state (Pernambuco, Brazil) on entry:

Importation Tax – BRL 312.18 (60% of declared value)

ICMS / GNRE (state sales tax) – BRL 170.51 (20.48% of declared value+importation tax)

Administrative charge – BRL 44.97

Total taxes and charges – BRL 527.66

In other words, the total taxes and other charges amount to approximately the declared value (100%) of the development board.

Now, that is no way to go about encouraging innovation!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s